Lowering the cost of prescription drugs for the poorest seniors would cover about 40 percent of President Obama's goal for entitlement savings, Rockefeller said.

"We just give this money away to them," Rockefeller said.

Politically, though, the proposal isn't so simple. The pharmaceutical industry argues that any reductions in Medicare payments would hinder the research and development that leads to new, life-saving therapies.

Medicare cuts to prescription drugs would be "bad for patients, bad for innovation and bad for the economy," the industry's leading trade said in a statement when the same proposal was included in President Obama's budget.

The policy has also been a non-starter for congressional Republicans in recent deficit-reduction talks.

Sen. Angus King (I-Maine), however, said reducing Medicare payments for prescription drugs represents "good, solid conservative principles of being efficient with the taxpayers' money."

King said he intends to introduce a more far-reaching proposal that would apply discounts throughout Medicare's drug benefit.

Rockefeller's bill would apply only to about 9 million seniors — those who receive both Medicare and Medicaid. Those patients are old, poor, and tend to be among the sickest — and thus the most expensive — in the entire healthcare system.

Under Rockefeller's bill, drugs for "dual-eligible" beneficiaries would receive the discounts that Medicaid programs negotiate. Medicare does not negotiate prices with drug makers.

"You can't demonize them for profiteering when we're the ones responsible for it," Blumenthal said.